The National Association of REALTORS® “Remodeling Impact Report” dispels the myth that homeowners need major remodeling projects for a worthwhile return on investment and happiness. Smaller, lower-cost home improvement projects can provide payback and joy. This is particularly good news for millennials, Gen Xers, and potential buyers who had to compromise on their home purchases or were rejected. Smaller remodels are cost-effective and suitable for DIY projects, with some renovation products returning to the market.
These are the top five high-performing projects listed in the report are
- Hardwood Flooring Refinish or Replacement: Refinishing hardwood floors has the highest return on investment, estimated at $3,400 cost with a $5,000 value recovery (147% return). It also receives a perfect joy score of 10. Hardwood floors are favored for their durability, cleanliness, and resistance to stains and odors.
- Insulation Upgrade: Upgrading insulation is valued for its energy efficiency and cost savings. With an average cost of $2,500, it recovers the same amount, resulting in a break-even scenario. Insulation upgrades receive a joy score of 10. Some insulation materials can be installed as DIY projects, but professional help may be needed for certain types.
- Closet Renovation: Upgrading closets improves livability, organization, and storage. Although it costs around $6,000, the cost recovery is $5,000 (83% return). Consumers express high satisfaction and a desire to spend more time at home after the remodel.
- Add or Upgrade Laundry Area: Laundry room improvements enhance functionality and livability. The cost of laundry room remodeling ranges from $4,000 to $12,000, depending on size and features. Improved functionality is the most important result, with a joy score of 9.5.
- Paint One Interior Room: Painting a room is a DIY-friendly project that offers a significant change and upgrade to worn-out surfaces. Hiring a professional for this task costs around $990 to $1,320. Consumers value the beauty and aesthetics of freshly painted rooms, resulting in a joy score of 1.
While the report also covers larger projects like bathroom and kitchen renovations, smaller upgrades can bring happiness and a healthy return depending on budget and priorities.